Personal offers of a body's securities by a person do not need disclosure to investors under this Part if:

(a) none of the offers results in a breach of the 20 investors ceiling (see subsections (3) and (4)); and

(b) none of the offers results in a breach of the $2 million ceiling (see subsections (3) and (4)).

This subsection does not apply to an offer for sale to which subsection 707(3) (sale amounting to indirect issue) or (5) (sale amounting to indirect sale by controller) applies.

Note 1: Subsection 727(4) makes it an offence to issue or transfer securities without disclosure to investors once 20 issues or transfers have occurred or $2 million has been raised.

Note 2: Under section 740 ASIC may make a determination aggregating the transactions of bodies that ASIC considers to be closely related.

708(2)

For the purposes of subsection (1), a personal offer is one that:

(a) may only be accepted by the person to whom it is made; and

(b) is made to a person who is likely to be interested in the offer, having regard to:

(i) previous contact between the person making the offer and that person; or

(ii) some professional or other connection between the person making the offer and that person; or

(iii) statements or actions by that person that indicate that they are interested in offers of that kind.

708(3)

An offer by a body to issue securities:

(a) results in a breach of the 20 investors ceiling if it results in the number of people to whom securities of the body have been issued exceeding 20 in any 12 month period; and

(b) results in a breach of the $2 million ceiling if it results in the amount raised by the body by issuing securities exceeding $2 million in any 12 month period.

708(4)

An offer by a person to transfer a body's securities:

(a) results in a breach of the 20 investors ceiling if it results in the number of people to whom the person sells securities of the body exceeding 20 in any 12 month period; and

(b) results in a breach of the $2 million ceiling if it results in the amount raised by the person from selling the body's securities exceeding $2 million in any 12 month period.

708(5)

In counting issues and sales of the body's securities, and the amount raised from issues and sales, for the purposes of subsection (1), disregard issues and sales that result from offers that:

(a) do not need a disclosure document because of any other subsection of this section; or

(b) are not received in Australia; or

(c) are made under a disclosure document.

Note: Also see provisions on restrictions on advertising (section 734) and securities hawking provisions (Part 6D.3).

708(6)

(Repealed by No 122 of 2001, s 3, Sch 1, Pt 2[414].)

708(7)

In working out the amount of money raised by the body by issuing securities, include the following:

(a) the amount payable for the securities at the time when they are issued;

(b) if the securities are shares issued partly-paid - any amount payable at a future time if a call is made;

(c) if the security is an option - any amount payable on the exercise of the option;

(d) if the securities carry a right to convert the securities into other securities - any amount payable on the exercise of that right.

Sophisticated investors

708(8)

An offer of a body's securities does not need disclosure to investors under this Part if:

(a) the minimum amount payable for the securities on acceptance of the offer by the person to whom the offer is made is at least $500,000; or

(b) the amount payable for the securities on acceptance by the person to whom the offer is made and the amounts previously paid by the person for the body's securities of the same class that are held by the person add up to at least $500,000; or

(c) it appears from a certificate given by a qualified accountant no more than 6 months before the offer is made that the person to whom the offer is made:

(i) has net assets of at least the amount specified in regulations made for the purposes of this subparagraph; or

(ii) has a gross income for each of the last 2 financial years of at least the amount specified in regulations made for the purposes of this subparagraph a year; or

Application of items 73, 75 to 77 and 84

The amendments made by items 73, 75 to 77 and 84 of this Schedule apply to offers of securities made on or after the day on which those items commence.

]

708(9)

In calculating the amount payable, or paid, for securities for the purposes of paragraph (8)(a) or (b), disregard any amount payable, or paid, to the extent to which it is to be paid, or was paid, out of money lent by the person offering the securities or an associate.

(d) the person to whom the offer is made signs a written acknowledgment before, or at the time when, the offer is made that the licensee has not given the person a disclosure document under this Part in relation to the offer.

An offer of securities (other than options) does not need disclosure to investors under this Part if no consideration is to be provided for the issue or transfer of the securities.

708(16)

An offer of options does not need disclosure to investors under this Part if:

(a) no consideration is to be provided for the issue or transfer of the options; and

(b) no consideration is to be provided for the underlying securities on the exercise of the option.

Compromise or arrangement under Part 5.1

708(17)

An offer of securities does not need disclosure to investors under this Part if it is made under a compromise or arrangement under Part 5.1 approved at a meeting held as a result of an order under subsection 411(1) or (1A).

[CCH Note: Regulation 10.25.02(3)(i) (which was effective 1 March 2017) provides that the amendments made by No 11 of 2016, s 3, Sch 2[208] apply in relation to external administrations on and after 1 September 2017.]

[CCH Note: Regulation 10.25.02(3)(i) (which was effective 1 March 2017) provides that the amendments made by No 11 of 2016, s 3, Sch 2[208] apply in relation to external administrations on and after 1 September 2017.]